If you are facing mountains of debt, you owe more than you can pay and are constantly being harassed by debt collectors, your wages are being garnished, or your bank accounts frozen it may be time to consider filing bankruptcy. Before doing so here are five tips to consider.
You will first need to review your finances, debts, and expenses beforehand so that you know exactly where you stand. Pay attention to what caused the financial problem and how it could be avoided in the future.
Once you have analyzed your finances you will want to pull your credit report each of the three agencies. Some people think that because a debt collector has stopped calling them that the debt is no longer on their record; this couldn’t be farther from the truth. If you don’t include all creditors on your filing you could go through the whole process still owing.
This information will also help you to establish what debts can be discharged. Some non-dischargeable debts are taxes, child support or alimony payments, fraudulent debts, and student loans.
Bankruptcy laws are complicated, and many are not able to file on their own. Don’t make the process harder on yourself than it needs to be. A bankruptcy attorney will evaluate your current situation to make sure filing bankruptcy is the right option for you.
Credit counseling is one of the pre-filing requirements and it can take place up to six months prior to filing so you will want to get it done sooner rather than later. Once you have completed your credit counseling you will need to obtain your certificate of completion.
Once bankruptcy has been filed creditors cannot legally contact you, therefore it is a good idea to inform them that you have filed for bankruptcy and what district it is under.
Filing for bankruptcy should be a way to gain freedom and a chance to start over with your personal or business finances.